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TMI Blog2022 (2) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The ld. AR submitted that the payment of employee contribution to ESI for the month of May, 2018 was paid to ESI authorities on 21.6.2018 with a delay of 6 days which is before the due date of fling the return of income and otherwise allowable u/s. 43B of the Income-tax Act, 1961 [the Act]. 4. The ld. DR relied on the orders of lower authorities. 5. We have heard both the parties and perused the material on record. This issue is covered by the order of this Tribunal in the case of M/s. Jana Urban Services For Transformation Pvt. Ltd. v. DCIT, CPC in ITA No. 307/Bang/2021 dated 11.10.2021 wherein it was held as under:- "As seen from the above, the assessee made a sum of Rs. 19,04,700/- beyond the time prescribed under the relevant Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovision has nothing to do with the consequences, provided for under the PF Act/PF Scheme/ESI Act, for not depositing the "contribution" on or before the due dates therein. 16. In the present case, admittedly, though the employer did not deposit the contribution, within the stipulated time, as contemplated by paragraph-30 of the PF Scheme or before the due date under the provisions of the PF scheme/Act, he deposited the contribution to the PF/ESI fund before the due date contemplated under Section 139(1) of the Act. 17. Section 6 of the PF Act provides for contributions and matters which may be provided for in Schemes. Paragraph-29 of the PF Scheme states what is "Contribution". The expression "contribution" is also defined under the PF ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted therein with the provident fund or the fund under the ESI Act within fifteen days of the closure of every month pay. It is clear that the word "'contribution" used in Clause(b) of Section 43B of the IT Act means the contribution of the employer and the employee. That being so, if the contribution is made on or before the due date for furnishing the return of income under sub-section (1) of Section 139 of the IT Act is made, the employer is entitled for deduction. 21. The submission of Mr. Aravind, learned counsel for the revenue that if the employer fails to deduct the employees contribution on or before the due date, contemplated under the provisions of the PF Act and the PF Scheme, that would have to be treated as income within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the other provisions of the Act including section 36(1) clause (va) of the Act, even prior to the insertion of that clause the assessee is entitled to get statutory benefit of deduction of payment of tax from the Revenue. If that provision is read along with the first proviso of the said section which was inserted by the Finance Act, 1987, which came into effect from April 1, 1988, the letters numbered as clause (a), or clause (c) or clause (d) or clause (e) or clause (f) are omitted from the above proviso and therefore deduction towards the employees contribution paid can be claimed by the assessee. The Explanation to clause (va) of section 36(1) of the Income-tax Act further makes it very clear that the amount actually paid by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s case [1997] 224 ITR 677 and paragraph 59 referred to supra in this judgment from the Finance Bill with all fours supports the case of the assessee/respondents. Therefore, we have to answer the substantial question of law No. 1 framed by this court in these appeals at the instance of the Revenue against them, viz., in the negative. Accordingly, we answer the substantial question No. 1 framed in these appeals in the negative. 10. Further he relied on the following judgments:- 1. In Re-Cognizance for Extension of Limitation -Supreme Court of India in M.P No. 665/2021 in SMW(C) No. 3/2020 dt. 19/7/2021. 2. Salzgitter Hydraulics Pvt. Ltd. vs ITO [2021] 128 taxman.com 192 [Hyderabad Tribunal] 3. M/s. Crescent Roadways Pvt. Ltd. vs Dy CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it would necessarily to be held that Explanation 5 to sec. 43B and Explanation 2 to sec. 36(1)(va) would apply to all pending matters as on date. 12. We find no merit in the argument of the ld. DR since the explanation as provided in Finance Act 2021 prescribes that the amendment in both sec. 36(va) as well as 43B by inserting corresponding explanation that although impugned PF comes in the form of provision and the same is applicable from 1/4/2021 onwards only. In the present case we are concerned with the asst. year 2017-18 and the amended provision could not be applied retrospectively as it is only applicable w.e.f 1/4/2021. Being so no disallowance could be made by the AO in respect of PF/ESI paid within the due date of filing return ..... X X X X Extracts X X X X X X X X Extracts X X X X
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